TIDMABT
RNS Number : 7645E
Abbott Laboratories
20 July 2016
Abbott Reports Second-Quarter 2016 Results
- SECOND-QUARTER REPORTED SALES GROWTH OF 3.2 PERCENT;
OPERATIONAL SALES GROWTH OF 6.4 PERCENT
- SECOND-QUARTER GAAP EPS FROM CONTINUING OPERATIONS OF $0.40;
ADJUSTED EPS FROM CONTINUING OPERATIONS OF $0.55
- SEVERAL NEW PRODUCT APPROVALS AND LAUNCHES ACROSS DIVERSE
BUSINESS PORTFOLIO
ABBOTT PARK, Ill., July 20, 2016 /PRNewswire/ -- Abbott (NYSE:
ABT) today announced financial results for the second quarter ended
June 30, 2016.
-- Second-quarter worldwide sales of $5.3 billion increased 3.2
percent on a reported basis and 6.4 percent on an operational
basis.
-- Reported diluted EPS from continuing operations under GAAP
was $0.40 in the second quarter. Excluding specified items,
adjusted diluted EPS from continuing operations was $0.55 in the
second quarter, above the previous guidance range.
-- Abbott's full-year 2016 EPS for continuing operations under
GAAP is projected to be $1.26 to $1.36. Projected full-year 2016
adjusted EPS for continuing operations remains unchanged at $2.14
to $2.24.
-- In July, Abbott received U.S. FDA approval for Absorb(TM) ,
the only fully dissolving heart stent, as well as U.S. FDA approval
for TECNIS(R) Symfony intraocular lenses for the treatment of
cataracts, the first and only extended depth of focus lenses for
people with cataracts.
-- In the second quarter, Abbott announced the global launch of
AlinIQ, the first-of-its-kind informatics solution with enhanced
capabilities to help diagnostics laboratories increase productivity
and flexibility in managing data throughout hospital networks.
-- On April 28, 2016, Abbott announced an agreement to acquire
St. Jude Medical, Inc. The transaction will create a premier
medical device leader with a highly competitive portfolio that will
include an industry-leading pipeline across cardiovascular,
neuromodulation, diabetes and vision care.
"It was a good quarter," said Miles D. White, chairman and chief
executive officer, Abbott. "We're particularly pleased with the
steady cadence of new product approvals and recent launches that
are contributing to growth, including FreeStyle Libre, MitraClip,
Absorb and Symfony."
SECOND-QUARTER BUSINESS OVERVIEW
Following are sales by business segment and commentary for the
second quarter and first half of the year:
Total Company
($ in millions)
% Change vs. 2Q15
------------------------------------------------------------
Sales 2Q16 Int'l Total
------------------------- ------------------------- -------------------------
U.S. Int'l Total U.S. Reported Operational Reported Operational
------- ------- ------- ------ ---------- ------------- ---------- -------------
Total * 1,655 3,678 5,333 4.0 2.8 7.5 3.2 6.4
------- ------- ------- ------ ---------- ------------- ---------- -------------
Nutrition 750 990 1,740 3.0 0.2 5.3 1.4 4.3
Diagnostics 361 865 1,226 3.0 4.5 7.3 4.1 6.0
Established
Pharmaceuticals -- 980 980 n/a 0.4 9.5 0.4 9.5
Medical Devices 535 837 1,372 6.1 6.6 7.3 6.4 6.8
* Total Abbott Sales from continuing operations include Other Sales of $15 million.
------------------------------------------------------------------------------------------------------------
% Change vs. 1H15
------------------------------------------------------------
Sales 1H16 Int'l Total
-------------------------- ------------------------- -------------------------
U.S. Int'l Total U.S. Reported Operational Reported Operational
------- ------- -------- ------ ---------- ------------- ---------- -------------
Total * 3,186 7,032 10,218 3.0 0.8 7.0 1.5 5.8
------- ------- -------- ------ ---------- ------------- ---------- -------------
Nutrition 1,469 1,942 3,411 3.9 (1.5) 4.6 0.8 4.3
Diagnostics 700 1,644 2,344 3.3 3.2 7.7 3.2 6.4
Established
Pharmaceuticals -- 1,868 1,868 n/a (0.3) 10.2 (0.3) 10.2
Medical Devices 1,001 1,568 2,569 1.2 2.8 5.4 2.1 3.7
* Total Abbott Sales from continuing operations include Other Sales of $26 million.
-------------------------------------------------------------------------------------------------------------
n/a = Not Applicable.
-------------------------------------------------------------------------------------------------------------
Note: Operational growth reflects percentage change over the prior year excluding the impact
of exchange rates. In order to compute results excluding the impact of exchange rates, current
year U.S. dollar sales are multiplied or divided, as appropriate, by the current year average
foreign exchange rates and then those amounts are multiplied or divided, as appropriate, by
the prior year average foreign exchange rates.
-------------------------------------------------------------------------------------------------------------
Second-quarter 2016 worldwide sales of $5.3 billion increased
3.2 percent on a reported basis, including an unfavorable 3.2
percent effect of foreign exchange, and increased 6.4 percent on an
operational basis.
International sales increased 2.8 percent on a reported basis
and 7.5 percent on an operational basis in the second quarter.
International operational growth was led by strong performance
across all of Abbott's business segments.
Emerging market sales increased 1.1 percent on a reported basis
and 8.5 percent on an operational basis in the second quarter.
Excluding the impact of Venezuelan operations, emerging market
sales would have increased 4.8 percent on a reported basis and 12.4
percent on an operational basis.
Nutrition
($ in millions)
% Change vs. 2Q15
-------------------------------------------------------------
Sales 2Q16 Int'l Total
------------------------ ------------------------- -------------------------
U.S. Int'l Total U.S. Reported Operational Reported Operational
------ ------- ------- ------- ---------- ------------- ---------- -------------
Total 750 990 1,740 3.0 0.2 5.3 1.4 4.3
------ ------- ------- ------- ---------- ------------- ---------- -------------
Pediatric 425 547 972 5.8 (3.4) 1.6 0.4 3.4
Adult 325 443 768 (0.6) 5.1 10.3 2.6 5.5
% Change vs. 1H15
------------------------------------------------------------
Sales 1H16 Int'l Total
------------------------- ------------------------- -------------------------
U.S. Int'l Total U.S. Reported Operational Reported Operational
------- ------- ------- ------ ---------- ------------- ---------- -------------
Total 1,469 1,942 3,411 3.9 (1.5) 4.6 0.8 4.3
------- ------- ------- ------ ---------- ------------- ---------- -------------
Pediatric 828 1,111 1,939 5.3 (2.8) 2.9 0.5 3.9
Adult 641 831 1,472 2.2 0.3 7.0 1.1 4.9
Worldwide Nutrition sales increased 1.4 percent on a reported
basis in the second quarter, including an unfavorable 2.9 percent
effect of foreign exchange, and increased 4.3 percent on an
operational basis. Excluding the impact of Venezuelan operations,
worldwide Nutrition sales would have increased 3.3 percent on a
reported basis and 6.2 percent on an operational basis.
Worldwide Pediatric Nutrition sales increased 0.4 percent on a
reported basis in the second quarter, including an unfavorable 3.0
percent effect of foreign exchange, and increased 3.4 percent on an
operational basis. Sales growth in the quarter was led by
above-market growth in the U.S. with continued uptake of recently
launched products, including infant and toddler non-GMO products,
as well as strong performance across several countries in Latin
America and Asia.
Worldwide Adult Nutrition sales increased 2.6 percent on a
reported basis in the second quarter, including an unfavorable 2.9
percent effect of foreign exchange, and increased 5.5 percent on an
operational basis. Operational sales growth in the quarter was led
by strong growth of Abbott's complete and balanced nutrition brand,
Ensure(R) , and double-digit growth internationally.
Diagnostics
($ in millions)
% Change vs. 2Q15
------------------------------------------------------------
Sales 2Q16 Int'l Total
------------------------ ------------------------- -------------------------
U.S. Int'l Total U.S. Reported Operational Reported Operational
------ ------- ------- ------ ---------- ------------- ---------- -------------
Total 361 865 1,226 3.0 4.5 7.3 4.1 6.0
------ ------- ------- ------ ---------- ------------- ---------- -------------
Core
Laboratory 206 772 978 0.1 4.3 7.1 3.4 5.6
Molecular 51 68 119 1.1 3.6 5.9 2.5 3.8
Point of
Care 104 25 129 10.2 17.2 17.4 11.5 11.5
% Change vs. 1H15
-------------------------------------------------------------
Sales 1H16 Int'l Total
----------------------- ------------------------- -------------------------
U.S
. Int'l Total U.S. Reported Operational Reported Operational
----- ------- ------- ------- ---------- ------------- ---------- -------------
Total 700 1,644 2,344 3.3 3.2 7.7 3.2 6.4
----- ------- ------- ------- ---------- ------------- ---------- -------------
Core
Laboratory 396 1,467 1,863 1.2 3.2 7.8 2.8 6.4
Molecular 98 129 227 (0.5) 0.2 4.6 (0.1) 2.4
Point of
Care 206 48 254 9.7 12.1 13.4 10.1 10.4
Worldwide Diagnostics sales increased 4.1 percent on a reported
basis in the second quarter, including an unfavorable 1.9 percent
effect of foreign exchange, and increased 6.0 percent on an
operational basis.
Core Laboratory Diagnostics sales increased 3.4 percent on a
reported basis in the second quarter, including an unfavorable 2.2
percent effect of foreign exchange, and increased 5.6 percent on an
operational basis. Operational sales growth in the quarter was led
by double-digit growth in emerging markets. During the quarter,
Abbott launched AlinIQ, a first-of-its-kind professional services
and informatics solution that enhances diagnostic laboratory
productivity and flexibility in managing data throughout hospital
networks.
Molecular Diagnostics sales increased 2.5 percent on a reported
basis in the second quarter, including an unfavorable 1.3 percent
effect of foreign exchange, and increased 3.8 percent on an
operational basis. As expected, continued strong growth in Abbott's
infectious disease testing business was partially offset by the
planned scale down of its genetics business.
Point of Care Diagnostics sales increased 11.5 percent on a
reported and operational basis. Double-digit sales growth was led
by continued adoption of Abbott's i-STAT(R) handheld system in the
U.S. and international markets.
Established Pharmaceuticals
($ in millions)
% Change vs. 2Q15
------------------------------------------------------------
Sales 2Q16 Int'l Total
-------------------------- ------------------------- -------------------------
U.S. Int'l Total U.S. Reported Operational Reported Operational
------- ------- ------- ------ ---------- ------------- ---------- -------------
Total -- 980 980 n/a 0.4 9.5 0.4 9.5
-------- ------- ------- ------ ---------- ------------- ---------- -------------
Key
Emerging
Markets -- 754 754 n/a 3.9 15.9 3.9 15.9
Other -- 226 226 n/a (9.9) (9.1) (9.9) (9.1)
% Change vs. 1H15
------------------------------------------------------------
Sales 1H16 Int'l Total
-------------------------- ------------------------- -------------------------
U.S. Int'l Total U.S. Reported Operational Reported Operational
------- ------- ------- ------ ---------- ------------- ---------- -------------
Total -- 1,868 1,868 n/a (0.3) 10.2 (0.3) 10.2
-------- ------- ------- ------ ---------- ------------- ---------- -------------
Key
Emerging
Markets -- 1,388 1,388 n/a 0.5 14.0 0.5 14.0
Other -- 480 480 n/a (2.6) (0.4) (2.6) (0.4)
Established Pharmaceuticals sales increased 0.4 percent on a
reported basis in the second quarter, including an unfavorable 9.1
percent effect of foreign exchange, and increased 9.5 percent on an
operational basis. Excluding the impact of Venezuelan operations,
Established Pharmaceuticals sales would have increased 4.6 percent
on a reported basis and 14.1 percent on an operational basis.
Key Emerging Markets include India, Russia, Brazil and China,
along with several additional emerging markets that represent the
most attractive long-term growth opportunities for Abbott's branded
generics product portfolio. Sales in these key geographies
increased 3.9 percent on a reported basis and 15.9 percent on an
operational basis. Operational sales growth was led by continued
strong growth in India, which comprises more than 20 percent of
Abbott's Established Pharmaceuticals sales, as well as Russia,
China and several countries throughout Latin America.
Medical Devices
($ in millions)
% Change vs. 2Q15
--------------------------------------------------------------
Sales 2Q16 Int'l Total
----------------------- ------------------------- -------------------------
U.S
. Int'l Total U.S. Reported Operational Reported Operational
----- ------- ------- -------- ---------- ------------- ---------- -------------
Total 535 837 1,372 6.1 6.6 7.3 6.4 6.8
----- ------- ------- -------- ---------- ------------- ---------- -------------
Vascular 346 436 782 16.4 2.7 3.6 8.3 8.9
Diabetes Care 73 210 283 (21.6) 13.4 15.2 1.7 2.8
Medical Optics 116 191 307 1.9 9.1 7.7 6.2 5.4
Vascular Product
Lines:
Coronary
Devices(a) 202 367 569 3.9 1.2 2.0 2.1 2.6
Endovascular(b) 77 68 145 8.5 10.5 12.3 9.4 10.2
(a) Includes DES / BVS product portfolio, structural heart, guidewires, balloon catheters
and other coronary products.
(b) Includes vessel closure, carotid stents and other peripheral products.
% Change vs. 1H15
--------------------------------------------------------------
Sales 1H16 Int'l Total
------------------------- ------------------------- -------------------------
U.S. Int'l Total U.S. Reported Operational Reported Operational
------- ------- ------- -------- ---------- ------------- ---------- -------------
Total 1,001 1,568 2,569 1.2 2.8 5.4 2.1 3.7
------- ------- ------- -------- ---------- ------------- ---------- -------------
Vascular 635 832 1,467 9.3 (0.8) 1.9 3.3 5.0
Diabetes Care 142 384 526 (26.8) 9.3 13.2 (3.6) (1.1)
Medical Optics 224 352 576 4.5 5.0 6.0 4.8 5.4
Vascular Product
Lines:
Coronary
Devices(a) 396 703 1,099 4.4 (2.2) 0.4 0.1 1.8
Endovascular(b) 150 128 278 9.0 6.8 10.5 7.9 9.7
(a) Includes DES / BVS product portfolio, structural heart, guidewires, balloon catheters
and other coronary products.
(b) Includes vessel closure, carotid stents and other peripheral products.
Worldwide Medical Devices sales increased 6.4 percent on a
reported basis in the second quarter, including an unfavorable 0.4
percent effect of foreign exchange, and increased 6.8 percent on an
operational basis.
Worldwide sales of Vascular products increased 8.3 percent on a
reported basis in the second quarter, including an unfavorable 0.6
percent effect of foreign exchange, and increased 8.9 percent on an
operational basis. Sales were favorably impacted by the resolution
of previously disputed third-party royalty revenue related to the
prior year. Excluding this impact, worldwide sales of Vascular
products would have increased 4.1 percent on a reported basis and
4.7 percent on an operational basis, and U.S. sales would have
increased 6.2 percent on a reported and operational basis.
Sales growth in Vascular products was led by double-digit growth
of MitraClip(R) , Abbott's device for the treatment of mitral
regurgitation, as Abbott continues to build the market for this
first-in-class device. Double-digit operational sales growth in
Abbott's Endovascular business was driven by vessel closure
products and Supera(R) , Abbott's unique peripheral stent for the
treatment of blockages in the leg. In July, the U.S. FDA approved
Abbott's Absorb bioresorbable stent, the only fully dissolving
heart stent. Absorb offers a unique benefit to patients, as it is
designed to treat coronary artery disease like a metallic stent,
but then disappears after the artery is healed, leaving no metal
behind to restrict natural vessel motion.
Worldwide Diabetes Care sales increased 1.7 percent on a
reported basis in the second quarter, including an unfavorable 1.1
percent effect of foreign exchange, and increased 2.8 percent on an
operational basis. International sales growth was driven by
continued consumer uptake of FreeStyle(R) Libre, Abbott's
revolutionary Flash Glucose Monitoring System that eliminates
routine finger sticks and finger-stick calibration. In the U.S.,
sales were impacted by competitive and market dynamics.
Worldwide Medical Optics sales increased 6.2 percent on a
reported basis in the second quarter, including a favorable 0.8
percent effect of foreign exchange, and increased 5.4 percent on an
operational basis. Operational sales growth was driven by continued
market uptake of cataract products in the premium intraocular lens
segment. In July, Abbott received U.S. FDA approval for the TECNIS
Symfony intraocular lenses, the first and only lenses in the U.S.
that provide a full range of continuous high-quality vision
following cataract surgery.
ABBOTT'S FULL-YEAR EARNINGS-PER-SHARE GUIDANCE
Abbott projects earnings per share from continuing operations
under Generally Accepted Accounting Principles (GAAP) of $1.26 to
$1.36 for the full year 2016.
Abbott forecasts net specified items for the full year 2016 of
approximately $0.88 per share. Specified items include intangible
amortization expense, the impact of the Venezuelan currency
devaluation in the first quarter, expenses associated with
acquisitions, including bridge facility fees, and charges related
to cost reduction initiatives and other expenses, partially offset
by the favorable resolution of various tax positions from prior
years.
Excluding specified items, projected earnings per share from
continuing operations remains unchanged at $2.14 to $2.24 for the
full year 2016.
ABBOTT DECLARES 370(TH) QUARTERLY DIVID
On June 10, 2016, the board of directors of Abbott declared the
company's quarterly dividend of $0.26 per share. Abbott's cash
dividend is payable Aug. 15, 2016, to shareholders of record at the
close of business on July 15, 2016.
Abbott is a member of the S&P 500 Dividend Aristocrats
Index, which tracks companies that have annually increased their
dividend for 25 consecutive years.
About Abbott:
Abbott is a global healthcare company devoted to improving life
through the development of products and technologies that span the
breadth of healthcare. With a portfolio of leading, science-based
offerings in diagnostics, medical devices, nutritionals and branded
generic pharmaceuticals, Abbott serves people in more than 150
countries and employs approximately 74,000 people.
Visit Abbott at www.abbott.com and connect with us on Twitter at
@AbbottNews.
Abbott will webcast its live second-quarter earnings conference
call through its Investor Relations website at
www.abbottinvestor.com at 8 a.m. Central time today. An archived
edition of the call will be available after 11 a.m. Central
time.
- Private Securities Litigation Reform Act of 1995 -
A Caution Concerning Forward-Looking Statements
Some statements in this news release may be forward-looking
statements for purposes of the Private Securities Litigation Reform
Act of 1995. Abbott cautions that these forward-looking statements
are subject to risks and uncertainties that may cause actual
results to differ materially from those indicated in the
forward-looking statements. Economic, competitive, governmental,
technological and other factors that may affect Abbott's operations
are discussed in Item 1A, "Risk Factors," to our Annual Report on
Securities and Exchange Commission Form 10-K for the year ended
Dec. 31, 2015, and are incorporated by reference. Abbott undertakes
no obligation to release publicly any revisions to forward-looking
statements as a result of subsequent events or developments, except
as required by law.
Abbott Laboratories and Subsidiaries
Condensed Consolidated Statement of Earnings
Second Quarter Ended June 30, 2016 and 2015
(in millions, except per share data)
(unaudited)
2Q16 2Q15 % Change
-------- -------- ----------
Net Sales $5,333 $5,170 3.2
Cost of products sold, excluding amortization expense 2,287 2,218 3.1
Amortization of intangible assets 145 151 (4.0)
Research and development 348 345 0.9
Selling, general, and administrative 1,737 1,727 0.6
Total Operating Cost and Expenses 4,517 4,441 1.7
-------- --------
Operating earnings 816 729 11.9
Interest expense, net 83 17 n/m
Net foreign exchange (gain) loss 10 5 77.0
Other (income) expense, net 8 (279) n/m 1)
-------- --------
Earnings from Continuing Operations before taxes 715 986 (27.4)
Tax expense on Earnings from Continuing Operations 116 200 (42.0)
Earnings from Continuing Operations 599 786 (23.8)
Earnings (Loss) from Discontinued Operations, net of taxes 16 (1) n/m
Gain (Loss) on Sale of Discontinued Operations, net of taxes -- (1) n/m
-------- --------
Net Earnings (Loss) from Discontinued Operations, net of taxes 16 (2) n/m
-------- --------
Net Earnings $615 $784 (21.5)
======== ========
Net Earnings from Continuing Operations, excluding
Specified Items, as described below $812 $786 3.3 2)
======== ========
Diluted Earnings per Common Share from:
Continuing Operations $0.40 $0.52 (23.1)
Discontinued Operations 0.01 -- n/m
Total $0.41 $0.52 (21.2)
======== ========
Diluted Earnings per Common Share from Continuing
Operations, excluding Specified Items, as described below $0.55 $0.52 5.8 2)
======== ========
Average Number of Common Shares Outstanding
Plus Dilutive Common Stock Options 1,480 1,504
NOTES:
-------------------------------------------------------------------------------------------------------------------
See tables below for an explanation of certain non-GAAP financial information.
-------------------------------------------------------------------------------------------------------------------
n/m = Percent change is not meaningful.
-------------------------------------------------------------------------------------------------------------------
See footnotes below.
-------------------------------------------------------------------------------------------------------------------
1) 2015 Other (income) expense includes a gain on the sale of a portion of Abbott's position
in Mylan stock and a decrease in the fair value of contingent consideration related to a business
acquisition, both reported as specified items.
---- ----------------------------------------------------------------------------------------------------
2) 2016 Net Earnings from Continuing Operations, excluding Specified Items, excludes net after-tax
charges of $213 million, or $0.15 per share, for intangible amortization expense, expenses
primarily associated with acquisitions, including bridge facility fees, and charges related
to cost reduction initiatives and other expenses.
---- ----------------------------------------------------------------------------------------------------
2015 Net Earnings from Continuing Operations, excluding Specified Items, excludes net after-tax
charges of less than $1 million as intangible amortization expense, expenses associated with
cost reduction initiatives and expenses related to acquisitions were offset by a gain on the
sale of a portion of Abbott's position in Mylan stock and a decrease in the fair value of
contingent consideration related to a business acquisition.
---- ----------------------------------------------------------------------------------------------------
Abbott Laboratories and Subsidiaries
Condensed Consolidated Statement of Earnings
First Half Ended June 30, 2016 and 2015
(in millions, except per share data)
(unaudited)
1H16 1H15 % Change
---------- --------- ----------
Net Sales $10,218 $10,067 1.5
Cost of products sold, excluding amortization expense 4,427 4,299 3.0
Amortization of intangible assets 289 307 (5.8)
Research and development 727 658 10.5
Selling, general, and administrative 3,435 3,464 (0.8)
Total Operating Cost and Expenses 8,878 8,728 1.7
---------- ---------
Operating earnings 1,340 1,339 0.1
Interest expense, net 108 33 n/m
Net foreign exchange (gain) loss 488 (49) n/m 1)
Other (income) expense, net 27 (284) n/m
---------- ---------
Earnings from Continuing Operations before taxes 717 1,639 (56.3)
Tax expense on Earnings from Continuing Operations 62 324 (80.9) 2)
Earnings from Continuing Operations 655 1,315 (50.2)
Earnings from Discontinued Operations, net of taxes 260 25 n/m
Gain on Sale of Discontinued Operations, net of taxes 16 1,736 (99.1)
----------
Net Earnings from Discontinued Operations, net of taxes 276 1,761 (84.3) 3)
---------- ---------
Net Earnings $931 $3,076 (69.7)
========== =========
Net Earnings from Continuing Operations, excluding
Specified Items, as described below $1,427 $1,505 (5.2) 4)
========== =========
Diluted Earnings per Common Share from:
Continuing Operations $0.44 $0.87 (49.4)
Discontinued Operations 0.19 1.16 (83.6) 3)
Total $0.63 $2.03 (69.0)
========== =========
Diluted Earnings per Common Share from Continuing
Operations, excluding Specified Items, as described below $0.96 $0.99 (3.0) 4)
========== =========
Average Number of Common Shares Outstanding
Plus Dilutive Common Stock Options 1,482 1,511
NOTES:
-------------------------------------------------------------------------------------------------------------------
See tables below for an explanation of certain non-GAAP financial information.
-------------------------------------------------------------------------------------------------------------------
n/m = Percent change is not meaningful.
-------------------------------------------------------------------------------------------------------------------
See footnotes below.
-------------------------------------------------------------------------------------------------------------------
1) 2016 Net foreign exchange (gain) loss includes a loss of $477 million related to the revaluation
of Abbott's net monetary assets in Venezuela using the Dicom exchange rate, which is the Venezuelan
government's official floating exchange rate.
---- ------------------------------------------------------------------------------------------------------
2) 2016 Tax expense on Earnings from Continuing Operations includes the impact of a net tax benefit
of approximately $145 million as a result of the resolution of various tax positions from
prior years, partially offset by the unfavorable impact of non-deductible foreign exchange
losses related to Venezuela.
---- ------------------------------------------------------------------------------------------------------
3) 2016 Earnings and Diluted Earnings per Common Share from Discontinued Operations, net of taxes
primarily reflect the impact of a net tax benefit of $266 million as a result of the resolution
of various tax positions from prior years.
---- ------------------------------------------------------------------------------------------------------
2015 Earnings and Diluted Earnings per Common Share from Discontinued Operations, net of taxes
reflect the after-tax gain of $1.736 billion on the sale of the developed markets branded
generics pharmaceuticals and animal health businesses to Mylan on Feb. 27, 2015 and Zoetis
on Feb. 10, 2015, respectively; the first-quarter financial results from these businesses
up to the date of sale; and a favorable adjustment to tax expense as a result of the resolution
of various tax positions from previous years related to AbbVie operations.
---- ------------------------------------------------------------------------------------------------------
4) 2016 Net Earnings from Continuing Operations, excluding Specified Items, excludes net after-tax
charges of $772 million, or $0.52 per share, for intangible amortization expense, the foreign
exchange loss related to Venezuela, expenses associated with acquisitions, including bridge
facility fees, and other charges related to cost reduction initiatives and other expenses,
partially offset by the favorable impact of a net tax benefit as a result of the resolution
of various tax positions from prior years.
---- ------------------------------------------------------------------------------------------------------
2015 Net Earnings from Continuing Operations, excluding Specified Items, excludes net after-tax
charges of $190 million, or $0.12 per share, for intangible amortization expense, expenses
associated with cost reduction initiatives and expenses related to acquisitions, partially
offset by a gain on the sale of a portion of Abbott's position in Mylan stock and a decrease
in the fair value of contingent consideration related to a business acquisition.
---- ------------------------------------------------------------------------------------------------------
NON-GAAP RECONCILIATION OF FINANCIAL INFORMATION FROM CONTINUING OPERATIONS
Abbott Laboratories and Subsidiaries
Non-GAAP Reconciliation of Financial Information From Continuing Operations
Second Quarter Ended June 30, 2016 and 2015
(in millions, except per share data)
(unaudited)
2Q16
-----------------------------------------------
As
Reported Specified As % to
(GAAP) Items Adjusted Sales
----------- ----------- ----------- --------
Intangible Amortization $145 ($145) --
Gross Margin 2,901 170 $3,071 57.6%
R&D 348 (1) 347 6.5%
SG&A 1,737 (54) 1,683 31.6%
Interest expense, net 83 (57) 26
Other (income) expense, net 8 (1) 7
Earnings from Continuing Operations before taxes 715 283 998
Taxes on Earnings from Continuing Operations 116 70 186
Net Earnings from Continuing Operations 599 213 812
Diluted Earnings per Share from Continuing Operations $0.40 $0.15 $0.55
Specified items reflect intangible amortization expense of $145
million, and other expenses of $138 million, primarily associated
with acquisitions, including bridge facility fees, and charges
related to cost reduction initiatives and other expenses.
2Q15
------------------------------------------------------
As Specified As % to
Reported (GAAP) Items Adjusted Sales
------------------ ----------- ----------- --------
Intangible Amortization $151 ($151) --
Gross Margin 2,801 185 $2,986 57.8%
R&D 345 (20) 325 6.3%
SG&A 1,727 (67) 1,660 32.1%
Other (income) expense, net (279) 287 8
Earnings from Continuing Operations before taxes 986 (15) 971
Taxes on Earnings from Continuing Operations 200 (15) 185
Net Earnings from Continuing Operations 786 -- 786
Diluted Earnings per Share from Continuing
Operations $0.52 -- $0.52
Specified items reflect intangible amortization expense of $151
million and other expenses of $121 million, primarily associated
with cost reduction initiatives and acquisitions, partially offset
by a gain on the sale of a portion of Abbott's position in Mylan
stock of $207 million and a decrease in the fair value of
contingent consideration related to a business acquisition.
Abbott Laboratories and Subsidiaries
Non-GAAP Reconciliation of Financial Information From Continuing Operations
First Half Ended June 30, 2016 and 2015
(in millions, except per share data)
(unaudited)
1H16
-----------------------------------------------
As
Reported Specified As % to
(GAAP) Items Adjusted Sales
----------- ----------- ----------- --------
Intangible Amortization $289 ($289) --
Gross Margin 5,502 342 $5,844 57.2%
R&D 727 (46) 681 6.7%
SG&A 3,435 (97) 3,338 32.7%
Interest expense, net 108 (69) 39
Net foreign exchange (gain) loss 488 (477) 11
Other (income) expense, net 27 (5) 22
Earnings from Continuing Operations before taxes 717 1,036 1,753
Taxes on Earnings from Continuing Operations 62 264 326
Net Earnings from Continuing Operations 655 772 1,427
Diluted Earnings per Share from Continuing Operations $0.44 $0.52 $0.96
Specified items reflect intangible amortization expense of $289
million, the impact of the foreign exchange loss in Venezuela of
$477 million, and other expenses of $270 million, primarily
associated with acquisitions, including bridge facility fees, and
charges related to cost reduction initiatives and other expenses,
partially offset by a net tax benefit of approximately $145 million
as a result of the resolution of various tax positions from prior
years.
1H15
-----------------------------------------------
As
Reported Specified As % to
(GAAP) Items Adjusted Sales
----------- ----------- ----------- --------
Intangible Amortization $307 ($307) --
Gross Margin 5,461 371 $5,832 57.9%
R&D 658 (22) 636 6.3%
SG&A 3,464 (109) 3,355 33.3%
Other (income) expense, net (284) 282 (2)
Earnings from Continuing Operations before taxes 1,639 220 1,859
Taxes on Earnings from Continuing Operations 324 30 354
Net Earnings from Continuing Operations 1,315 190 1,505
Diluted Earnings per Share from Continuing Operations $0.87 $0.12 $0.99
Specified items reflect intangible amortization expense of $307
million and other expenses of $200 million, primarily associated
with cost reduction initiatives and acquisitions, partially offset
by a gain on the sale of a portion of Abbott's position in Mylan
stock of $207 million and a decrease in the fair value of
contingent consideration related to a business acquisition.
RECONCILIATION OF TAX RATE FOR CONTINUING OPERATIONS
A reconciliation of the second-quarter tax rates for continuing
operations for 2016 and 2015 is shown below:
2Q16
-------------------------------
Pre-Tax Taxes on Tax
($ in millions) Income Earnings Rate
--------- ----------- -------
As reported (GAAP) $715 $116 16.2%
Specified items 283 70
--------- -----------
Excluding specified items $998 $186 18.6%
2Q15
-------------------------------
Pre-Tax Taxes on Tax
($ in millions) Income Earnings Rate
--------- ----------- -------
As reported (GAAP) $986 $200 20.2%
Specified items (15) (15)
--------- -----------
Excluding specified items $971 $185 19.0%
A reconciliation of the year-to-date tax rates for continuing
operations for 2016 and 2015 is shown below:
1H16
--------------------------------------------------------------------
Pre-Tax Taxes on Tax
($ in millions) Income Earnings Rate
--------------------- --------------------- ----------------------
As reported (GAAP) $717 $62 8.6% 1)
Specified items 1,036 264
--------------------- ---------------------
Excluding specified
items $1,753 $326 18.6%
1H15
--------------------------------------------------------------------
Pre-Tax Taxes on Tax
($ in millions) Income Earnings Rate
--------------------- --------------------- ----------------------
As reported (GAAP) $1,639 $324 19.7%
Specified items 220 30
--------------------- ---------------------
Excluding specified
items $1,859 $354 19.0%
1) Reported tax rate on a GAAP basis for 2016 includes the impact of a net tax benefit
of approximately
$145 million as a result of the resolution of various tax positions from prior
years, partially
offset by the unfavorable impact of non-deductible foreign exchange losses related
to Venezuela.
----------------------- -------------------------------------------------------------------------------------
CONTACT: Abbott Financial: Scott Leinenweber, (224) 668-0791;
Michael Comilla, (224) 668-1872; Jeffrey Byrne, (224) 668-8808;
Abbott Media: Darcy Ross, (224) 667-3655; Elissa Maurer, (224)
668-3309
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR EAFXEASNKEFF
(END) Dow Jones Newswires
July 20, 2016 08:13 ET (12:13 GMT)
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